Balance Billing by Healthcare Providers

Most insured people expect their medical providers to abide by the terms of their health insurance contract and accept the negotiated amount their insurer pays, but this is not always the case, as is evidenced by something called balance billing. Here’s what you need to know about balance billing following a Colorado personal injury.

Are You Protected Against It Following a Colorado Personal Injury?

Several years ago, the New York Times reported on the struggles of a man who was blindsided by medical bills he received after neck surgery for herniated disks.

The man had scheduled his procedure with an in-network provider, at an in-network hospital, and thought he had covered all the bases regarding health insurance coverage. When the bills started to arrive, he knew his providers would accept a fraction of the fee and write off the rest because they were “in-network.” Then he was surprised by a bill for $117,000 from an assistant neurosurgeon whom he had never met, who was out-of-network and free to balance bill him in full for services rendered.

Consumers with health insurance typically expect that if they pay their premiums and utilize in-network providers, their insurance company will cover the cost of medically necessary care after they have met their co-pays and deductibles. However, some providers aren’t satisfied with the amount an insurance company pays for services rendered, and balance billing is on the rise. A 2015 survey conducted by Consumer Reports found that almost one-third of all privately insured people in the U.S. had received an unforeseen bill in the last two years when their health plan paid less than expected.

What Is Balance Billing?

Sometimes referred to as extra billing, balance billing occurs when a healthcare provider bills a patient for the difference between what the provider charges and what the patient’s health insurance pays. While an in-network provider has negotiated a payment rate with a health plan and agrees not to charge the plan or enrollee more than the agreed-upon rate, an out-of-network provider isn’t bound by such a contract, and may choose to bill the consumer for the balance not paid by their health plan, sometimes thousands of dollars worth of charges.

If a patient chooses to see an out-of-network provider, the understanding is that their out-of-pocket costs will be much higher and balance billing is likely. But even if consumers try to get care only from in-network providers, certain situations are out of their control, such as when they experience a medical emergency and receive treatment by an out-of-network doctor at an in-network emergency department, hospital, or other medical facility. Certain insurance plans don’t cover out-of-network care at all, and a provider balance bills the entire cost of care to the patient, an extremely frustrating situation.

Colorado Among States With Protections Against Balance Billing

There are no clear federal safeguards against balance billing, but 21 states have stepped up to protect citizens from this expensive and bewildering practice. Six of these states — California, Connecticut, Florida, Illinois, Maryland, and New York — have a comprehensive plan in place to protect consumers, while others, including Colorado, limit protections to emergency department settings, nonemergency care in network hospitals, and certain HMO and PPO plans. Twenty-nine states and the District of Columbia have no laws or regulations to protect consumers from balance billing by out-of-network providers working in emergency rooms or in-network hospitals.

Colorado has what is known as “hold harmless” protection that requires insurers to hold consumers harmless from the charges of medical providers, but does not expressly prohibit providers from billing consumers. As a result, some patients get balance bills and blindly send in a check because they don’t understand that they have the right not to pay a balance bill.